What about ven? Stan Stalnaker talks digital currency

A CoinDesk Q&A with Stan Stalnaker, founder of Hub Culture and the Ven digital currency.

AccessTimeIconMay 7, 2013 at 8:56 a.m. UTC
Updated May 2, 2022 at 3:58 p.m. UTC

CoinDesk caught up with Stan Stalnaker - founder of Hub Culture, a business club for international travellers and go-getters. When Hub Culture set up, it launched its own currency, Ven.

CD: How do you describe Ven to your friends?

SS: Ven is a global digital currency that’s easy to use and great for the environment. It can be traded instantly to anyone with no transaction cost inside HubCulture.com.  Since Ven is 100 percent backed for issuance, the underlying components that make up the value of Ven are important. By including carbon (along with other commodities and currencies), we are able to create a stable currency that supports the environment. So every time you use it, you’re helping the planet.

CD: How did you come up with the idea?

SS: We needed a single price for goods and services traded among the members of Hub Culture, our global collaboration network that grew out of the book of the same name, published in 2002. In 2007, we launched the Ven to help the community transact in a more simple way. From there, it evolved to have an exchange rate, a backing basket and other features.

CD: Which institution controls Ven?

SS: The Hub Culture social network controls the Ven and manages issuance.

CD: How is inflation controlled?

SS: We minimize inflation risk by maintaining a 100 percent reserve backing for Ven in issuance – which means that for any Ven out in the world, there are reserve funds equal to the component value of the underlying basket. Inflation is slower than in normal fiat currency because part of the basket is commodities, but it cannot be totally removed because much of the underlying reserves are regular currencies, which are indeed subject to inflation.

CD:What safeguards are in place to protect the currency?

SS: In addition to online security and ID factors for transfer, one of the biggest advantages of Ven is the social, transparent nature that comes with operating Ven linked to a social network. The socially open component of Ven makes visibility a major security feature.

CD: Can you bank in Ven?

SS: It depends on what you mean by this. Ven accounts function similarly to a bank account, enabling store of value, exchange and the ability to invest Ven into a number of virtual currency-related funds and assets. Major banks like Citibank have been at the forefront of Ven growth by purchasing Ven for their own use, but the banks themselves are not yet trading Ven.

CD: Can you print Ven when you need to? What safeguards are in place to stop that?

SS: Since Ven is totally digital, the release of currency is linked to the purchase of it, always with hard assets or by algorithmic rules that enable people to earn Ven – by inviting friends to use it, for instance.

Oversight of reserves is managed in conjunction with our reserve banking partners, including HSBC, and via our currency board, (which) approve(s) any changes to the structure of the currency. We’re also working on an outside insurance policy review to provide additional assurances around Ven for our community.

Hub Store

SS: In the beginning, I think people were skeptical that we needed a virtual currency – especially in the financial industry. We spent a lot of time, effort and money developing the Ven ecosystem so the currency had an environment in which to trade. As Ven has grown, and the carbon advantages for the planet became apparent as we developed, people have become more enthusiastic about the potential for Ven, and can see how it fits in the large mix of things.

CD: The Ven is now indexed by Thomson Reuters. What does that mean?

SS: Since 2011, Thomson Reuters has calculated elements of the basket and published exchange rates relative to other currencies. This makes Ven available on Thomson Reuters terminals.

CD: How many organizations accept Ven? Who are they and why do they use it?

SS: We have thousands of people and organizations using Ven through the HubCulture.com stores, through supplier relationships and other activities. We’re working on functionality to extend Ven to third parties via plugins to ecommerce and the like, but there are some regulatory limitations to what we can do on exchange back out of Ven, and we need to make sure we follow a conservative approach with regard to these extensions.

CD: What’s the best story you’ve heard where Ven was used?

SS: My favorite is that we’ve been able to enable commodity trades using Ven, which provide a derivative carbon offset to the trade. This model sets a framework in place that could have a huge impact on commodity trading at scale, by embedding carbon offsets to trades and helping make the world a greener place.

CD:  To what extent is Ven a novelty currency?

SS: Ven started out as a community currency for Hub Culture and has evolved into a viable solution for the financial world at large – especially around internet-linked transactions.

CD: How have you seen Ven used in a criminal sense?

SS: No. So far all Ven is transacting out through the stores, and large transactions are guided by our Knowledge Brokerage team, where KYC (“know-your-client”) and other research on the transaction is conducted. Since Ven is transparent, stable and resource-backed, it doesn’t have the same traits that make other virtual currencies attractive in these ways.

CD: What do you want to see happen with Ven?

SS: Ven operates at three levels – P2P, corporate and institutional. We would like to see members have the ability to trade Ven easily in the mobile environment and to be able to use it for a wide variety of activities. At the institutional level our ambition is to have 0.5% of global commodity trades priced in Ven. This would create enormous momentum for investment into carbon-related assets, which could single-handedly change the balance of power for clean energy and preservation of carbon-rich areas (forests, oceans, etc.).

Binary Code LandscapeCD: Various websites say you can buy carbon credits with Ven. How and why?

SS: You can – we offer a range of options related to carbon credits on our platform at HubCulture.com, from individual offset tonnage (where you can calculate your individual total footprint) to specific VER assets from partner projects, to funds that pool funding for placement with specific projects. The “why?” is simple – upward demand and financial support for environmental assets is one of the best ways to ensure they are protected. We curate relevant projects to make it easy for our community to access them. To see the range, visit http://hub.vg/CarbonAssets.

CD: Microfinance – what’s the story?

SS: Ven is a tremendous tool for microfinance because it divides easily and exchanges without friction, making it a perfect means of exchange at the microfinance level. We’ve been working to develop third-party partnerships in the microfinance sector to extend this to mobile transactions and to make sure that Hub Culture is supporting the right type of partners with Ven-related services.

CD:What is a “singular value”?

SS: Singular value is a concept first described by Stan Stalnaker in a TechCrunch article that examines the eventual relationship between the social graph, big data and monetary exchange. As data becomes pervasive and absolutely comparable, we will assign value to points on the graph, and they will eventually become exchangeable. Whether a proxy for a real-world asset or a digital point, once this exchange becomes available, it tends to negate the need for “currency”, because everything becomes effectively comparable and exchangeable in real time. Of course, currencies will still exist for ease of labeling but, in a way, many things will function as currency in this constantly comparing world of “singular value”.

CD: You were a first mover in digital currency. How do you think virtual currency will develop over the next decade?

SS: Hub Culture was one of the earliest players in the social network space and we all saw how large the category has become. I think the virtual currency sector will be as large (as) and maybe even more impactful than the social network sector and, in many ways they will intersect and be related. We’re in the center of these developments and happy to be innovating for our community in these areas.

CD: How do you feel about bitcoin and ripple now getting so much coverage even though Ven has been around a long time?

SS:  Ven is very, very different from both bitcoin and ripple, and the systems all have great potential to function together to serve different needs. With the arrival of OpenCoin and other units of exchange, innovation in the space is set to accelerate, and it will be great to see how these elements work together. For instance, it won’t be long before virtual currency exchanges operate like current fiat currency exchanges, and I expect someday you’ll be seeing IPOs on virtual exchanges just like you see them today on the NYSE.

CD: Do you use bitcoins?

SS: I have purchased bitcoins several times but kept losing them early on! These days we manage bitcoin assets through Hub Culture and have developed assets in Ven that our community can access to hold bitcoin without all the hassle. In fact, we just launched a Ven Fund that allows users to hold both Ven and bitcoin together: http://hub.vg/btcven.

CD: What’s the future of Ven, given bitcoin is getting all the headlines?

SS: Ven is inherently stable, transparent and less liquid than bitcoin, so it feels very conservative in comparison. For almost six years we’ve been developing and innovating with Ven in a careful way, and we’d rather take that approach. Building a currency that has a positive social impact is key to our approach, even if it means sacrificing catchy headlines.

CD: Will you accept bitcoins or ripple?

SS: We’re working on some developments in that area, but have concerns about the KYC aspects of bitcoin related to full monetary exchange. We would prefer to keep Ven as squeaky clean as possible, and so full exchange from us is not likely to happen right away.

CD: How much do you make through Ven? Is the pricing transparent?

SS: We don’t actually make anything on Ven – and there is no pricing cost to us when acquiring or trading it. We make a margin on sale for goods and services through our stores, and it is through this that we are able to manage and maintain the currency for the benefit of others.

CD: How long does it take to transact – and do you make a profit on the transaction time?

SS:  The average transaction takes less than a second, and about 30 seconds to complete from login to finish. We do not take a cut on transactions.

CD: If you could create Ven again today, what would you do differently?

SS: We are constantly innovating with Ven and developing new ways to extend Ven’s use for our members and the community. We are very focused on mobile right now and I just wish we had more funds to invest to make that move faster!

CD:  Tell us something we don’t yet know about Ven. What are you planning?

SS: We have some big announcements coming in May that center around extending Ven to let organizations and users manage multiple accounts, and to request Ven payments from their friends. These functions will help to widen the use case for Ven. In addition we’re working on some exciting FDI (foreign direct investment) and environmental deals that will showcase the true potential for Ven within nation-states serious about protecting their environmental assets. Stay tuned!


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